SocGen’s Profits Fall 82%

Daniel L
Category:  Financial News
French banking giant, Societe Generale or SocGen, has just published its fourth quarter earnings. The posted an 82 percent fall in quarterly net income. The company was pummeled by tax related charges and restructuring costs with its retail banking arm.

Looking at the quarterly earnings, net income fell to €69 million from €390 million last year. However the number beat market expectations for a €303 million loss.

In its quarterly result conference call, the lender said it was starting 2018 with confidence "in an economic and financial environment that should gradually be more favorable."

Speaking at this conference call. Deputy Chief Executive Officer Severin Cabannes, was upbeat despite the income drop. He said that the commercial lender continues to gain market share with its market activities. Cabannes said that the bank’s fixed income business has been good. He highlighted the rising demand for its products.

“If you compare with the average of the market, it is fair to say that our performance is above the average of the market this quarter," Cabannes said.

Speaking about this week’s volatility in the global financial markets, Cabannes noted that because volatility is and has been at historic lows throughout 2017, a change was and should be expected as we move forward. "We had a peak last Monday, but it is not a structural situation and we anticipate a bit higher volatility regime during the next period of time," he said.

However, this does not change the French lender’s positive outlook for this year. Also for next year’s in terms of market activities, Cabannes noted that they are “still very positive for the macroeconomic environment and including in this part of the business."

Earlier this week, Societe Generale’s main rival in France, BNP Paribas reported quarterly net profit that was also short of market forecasts. However, BNP Paribas did increase its 2020 profitability target.

In other corporate headlines, out of Europe, shares of Zurich Insurance rose over three percent. This was after its earnings beat expectations for the final quarter of 2017. That year’s net profit slumped six percent to $3 billion, but still beat analyst estimates of $2.72 billion. 
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